Banff Water Inc. bottles and distributes spring water. On April 2 of the current year, Banff Water Inc. reacquired 30,000 shares of its common stock at $33 per share. Banff had not previously purchased any treasury shares.

a. What is the balance of Treasury Stock on December 31 of the current year?

b. Where will the balance of Treasury Stock be reported on the balance sheet?

c. For what reasons might Banff Water Inc. have purchased the treasury stock?

d. Assume that on January 25 of the following year, Banff Water Inc. sold 20,000 shares of its treasury stock for $40 per share. Illustrate the effects on the accounts and financial statements of the sale of the treasury stock.

Audreys Restaurant Corporation wholesales ovens and ranges to restaurants throughout the Northwest. Audreys Restaurant Corporation, which had 50,000 shares of common stock outstanding, declared a 6-for-1 stock split.

a. What will be the number of shares outstanding after the split?

b. If the common stock had a market price of $540 per share before the stock split, what would be an approximate market price per share after the split?